The Earned Income Tax Credit, EITC or EIC as it is commonly know, is a tax benefit for working people with low to moderate income. It essential boosts their income by providing a refundable tax credit based on their income. Remember that you must have a job or other earned income in order to qualify for this tax credit. The government does not want encourage people not to work and to rely on government welfare by collecting this tax credit. Thus, there are certain income thresholds you must meet, but also certain income limitations which will prevent someone from claiming the earned income tax credit if they are making too much money.

To qualify for the earned income tax credit, taxpayers must meet certain requirements and file a tax return with IRS, even if you do not owe any tax or are not required to file a tax return. This is very important because many people do not file a tax return and then forgo the EITC when they would have otherwise qualified for it. For most people, the EITC reduces the amount of tax you owe and may give you a refund.

Important to remember that the 2012 American Tax Relief act extended the relief for married taxpayers claiming the EITC. This new tax expanded tax credit for taxpayers with three or more qualifying children and other provisions to December 31, 2017. Future laws could always change how the credit will apply to different taxpayer situations.

Remember that this information is about the 2016 EITC (for taxes filed in 2017) and uses figures recently released by the IRS. Always confirm all information with the IRS or a tax preparer

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